Chinese Refineries Reject Venezuelan Crude as U.S. Blockade Pushes Prices Higher

Chinese oil refiners are turning away from Venezuelan crude. What was once a cheap alternative is no longer inexpensive — and growing U.S. naval pressure is making the situation even more difficult. According to Bloomberg, the discount on Merey crude — Venezuela’s main export grade — has narrowed from $15 below Brent to just $13 below. It may seem minor, but for the market it’s a major shift. Since China is Venezuela’s largest customer, the impact is immediate.

Oil Shipments Plunge as U.S. Naval Pressure Takes Effect Bloomberg data shows that deliveries of Venezuelan crude to China dropped sharply last month. The U.S. blockade has disrupted export flows, shipping costs have surged, and traders are passing these expenses on to buyers — buyers who are now unwilling to pay more for the same barrel. Refiners are choosing to wait. Their storage tanks are full, and demand for bitumen — the main product made from Merey — is weak due to China’s slowdown in road construction.

Buyers Delay Purchases While Floating Storage Builds Up China’s refiners have a backup plan. Tankers carrying 82 million barrels of sanctioned crude, including Venezuelan oil, are currently anchored off the coasts of China and Malaysia. These floating inventories, tracked by Kpler, serve as an emergency reserve in case U.S. pressure further disrupts supply.

Political Tensions Escalate: Maduro Captured, Markets React The situation goes beyond prices — it’s also political. Over the weekend, the United States launched a surprise operation in which Venezuelan President Nicolás Maduro and his wife were flown to U.S. territory. Maduro now faces charges of drug trafficking and weapons violations. The geopolitical shock sent markets moving. Brent crude jumped 1.7% to nearly $62 per barrel, as traders speculated that Venezuela’s oil sector could be revived if Washington moves quickly to reshape the country’s political leadership.

Delcy Rodríguez Emerges as Washington’s Preferred Candidate Behind the scenes, U.S. officials and oil industry leaders are rallying around one name: Delcy Rodríguez, Maduro’s long-time second-in-command and former oil minister. According to sources, influential executives, lawyers, and lobbyists have advocated for her as the only realistic option to restart Venezuela’s collapsed oil sector. “Delcy is the one we’ve always negotiated with,” one senior industry insider said. “If anyone can revive production and reopen Chinese purchasing, it’s her.” Rodríguez has already been sworn in by the National Assembly as acting president. In a fiery speech, she called Maduro’s capture a “kidnapping,” demanding his return — though insiders say the speech was largely political theater meant to shield her from backlash as she consolidates power behind the scenes.

Chevron Maintains Operations While Industry Pushes for Sanction Relief Chevron — the only U.S. oil company still operating in Venezuela — stated it had no prior knowledge of the American operation. The company says it continues to comply fully with both U.S. and Venezuelan law. Meanwhile, oil firms are pressuring Washington to lift sanctions immediately so Rodríguez can stabilize the sector before it collapses entirely. In December, Venezuela was forced to shut down several wells because it had no storage capacity left — a direct consequence of blocked exports. If the situation does not improve soon, Rodríguez risks losing the leverage she has only just acquired. For now, however, she appears to be gaining ground, relying on Maduro’s old network to keep the system functioning — at least temporarily — while she works to revive production and reopen trade channels with China.

#venezuela , #oil , #china , #Geopolitics , #GlobalMarkets

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